Last year we recommended a high yield tax free investment with managed volatility.
Our rules based historical modeling research led us to the conclusion that this strategy would fit the needs of most of our taxable accounts.
We hoped it would provide a much higher return than CD’s, High Yield Bond Funds, and short term bonds both taxable and non taxable.
We designed it to be tactically managed to avoid substantial draw downs due to interest rate increases.
We eliminated the commissions brokers would charge as front end or rear end surrender charges.
The fee charged for management by the funds we used were drastically reduced below retail funds offered to investors in small quantities.
Our concept was to sell when the fund rose to what we believed was an unsustainable price and then lost upside price momentum. Our risk control was set to 2%.
Our plan was to reinvest when the fund price declined to what we believed was a value price after downside momentum ceased.
During the past 12 months our actual results were higher than we anticipated net of all fees and charges. We kept funds in cash for more than 3 months while still performing much better than the fund itself for the entire year.
We believe this strategy is an excellent savings strategy designed to build capital ultimately resulting in monthly tax free income.
In my opinion it is a good place based on client suitability to deposit free withdrawals from annuities and or mandatory withdrawals from IRA’s.
You may invest funds to pay annual life insurance premiums or simply accumulate monies for future tax free monthly income.
Building up capital with a goal in mind for monthly tax free income to use in retirement makes great sense.
You may have access to funds upon request with 3 days notice to your account by ACH or wire.